Is a deal worth the risks?
The internet giant may be buying the world’s most popular news aggregator in an acquisition that could give Google the power to influence what is read and shared on the web, according to a new report from research firm Quantcast.
The firm says Google’s News Lab has raised $2.6 billion in funding to build a network of data-driven content curation and aggregation platforms that could help it grow faster than competitors such as Facebook.
The deal could give the company access to a huge audience of data that it could use to determine what content users actually want and what content they are already consuming, Quantcast chief investment officer Daniel Yost said.
“We are seeing some early signs that News Lab is going to be able to scale up and scale to new areas of the industry,” Yost told CNBC.
The News Lab platform will be built on a “platform architecture” that can be used to curate news sources for advertisers, which could allow the company to create “a more targeted, targeted, curated platform that makes sense for News Lab and its advertisers,” Yast said.
The company has not yet announced a price tag for the deal, but the research firm says the company is hoping to break even in the next few years.
It’s not clear if Google is willing to pay a premium price for the platform, which is still in its early days.
The report comes as News Lab’s parent company, News Corp., seeks to turn around its struggling company after a year in which it struggled to grow.
The news site reported its fourth-quarter earnings on Tuesday.
The stock fell 2.7% on Wednesday to $25.79.
The acquisition of News Lab could be a good thing for Google, said Craig Barratt, a media analyst with The Motley Fool.
Google could gain a big chunk of the market for News, and it could also have a significant impact on the future of the web’s dominant social media company.
It also could help the company keep up with the growing popularity of social media.
Twitter Inc., Facebook Inc., and Snapchat Inc. have all been looking to acquire news platforms.
“There’s definitely a strong argument for the idea of having a News Lab that will have a much larger audience,” Barratt said.
Facebook recently acquired news platform Vox Media, which operates news sites such as Vox and TechCrunch.
Twitter, which also has a News Labs unit, acquired The Verge in December.